What will buoy ComfortDeGro taxi earnings in the next two years?

It will be supported by higher rental income from fleet.

With the popularity of ride-hailing apps like Uber and Grab, it would be easy to say that the taxi industry is daunted. But UOB KayHian is positive on ComfortDelGro's taxi business.

"Impact of private hire car on taxi may be gradual than steep. While the taxi industry remains challenging, we believe any impact on CD will likely be gradual than steep," UOB said.

Notably, despite a near doubling of private hire car drivers in the past year, CD’s hire-out rate remained resilient at 99%, which suggests that the industry may not be zero-sum.

"Moreover, ComfortDelGro tends to attract a different driver demographic catering more to full time drivers looking for stable income, while private hire car operators (characterised by high churn rate) attract drivers who look for flexibility in schedule. In the next 1-2 years, we believe taxi earnings will continue to be supported by higher rental income from fleet renewal as well as high utilisation rate," UOB explained.